the.com/impairment
The balance sheet's way of admitting it fell in love with a bad price and paid for it.
means A formal write-down that occurs when an asset's carrying value on the books exceeds what it's actually worth, forcing a company to recognize the loss.
from From Old French 'empeirier' meaning to make worse, rooted in Latin 'pejorare' (to make worse), itself built on 'peior,' the comparative of 'malus' — bad. So 'impair' has meant 'worsen' since medieval times; accounting simply borrowed the word centuries later to describe assets that have, quite literally, gotten worse on paper.
- not depreciation
- sudden write-down, not scheduled wear and tear
- test trigger
- carrying value exceeds recoverable value, no mercy
- goodwill magnet
- acquisitions overpay, then confess annually
- one-way street
- you can reverse it under IFRS, rarely under GAAP